Strait of Hormuz, big news! What will A-shares do tomorrow?

Each Daily Reporter | Xiao Ruidong     Each Daily Editor | Zhao Yun

Amid ongoing disruptions from external military conflict, along with investors seeking safety ahead of the holidays, in the last trading week (from March 30 to April 3), the A-share market saw an overall decline on reduced volume, with only 1,121 stocks posting cumulative gains.

Weekly performance of major market indices

Based on the three levels of K-line charts of the above-mentioned Wind All A Index, it is not hard to see:

Since March, the market has gradually pulled back in a “down for a week, up for a week” rhythm, retreating to the mid-December levels of last year, and has temporarily found support.

However, in the latter half of last week, both price and volume declined together. Put positively, it is “still building a base”; put negatively, it is a weak “no reversal yet.”

Shanghai Composite Index daily K

At market open tomorrow (April 7), the Hong Kong stock market is still closed for the holiday, meaning Northbound funds will continue to be absent, and A-share trading volume will be subject to some limitations.

On the other hand, it is also worth noting that on the 5th, Trump posted on social media saying:

“8:00 PM Eastern Time on Tuesday (the 7th)!”

Some media interpreted this as a further delay of what he calls the last deadline for an action aimed at destroying Iran’s energy facilities, pushing it back by one day. He had previously threatened that if Iran did not reach an agreement with the United States or open the Strait of Hormuz by 8:00 PM on April 6, U.S. Eastern Time, the U.S. would bomb infrastructure such as Iran’s power plants.

As a result, the market funds that originally needed to make an on-the-spot decision tomorrow may have to delay it.

According to CCTV News, however, on April 5 local time, Iran’s Supreme Leader Mojtaba Khamenei posted on social media saying that the will of the Iranian people is to continue conducting effective homeland defense operations, and that the strategic lever of blocking the Strait of Hormuz must also continue to be used.

In addition, Iranian officials also mentioned conditions for opening the strait. In response to Iran’s management and control of the Strait of Hormuz, Tabatabai, the deputy director for press and communications at the Iranian Presidential Palace, proposed that the Strait of Hormuz would be fully reopened only after establishing a new legal framework and using past tonnage tax revenue to compensate for all losses Iran suffered in past wars.

Judging from market reaction, on the morning of April 6 international oil prices rose. WTI crude oil futures jumped by more than 3% at one point, while U.S. stock index futures for the three major indexes opened lower and then turned higher, and stock markets in Japan and South Korea edged up modestly.

For the next response strategy, our advice remains:

Optimistic, but cautious.

As for “optimistic,” everyone can look back along this year’s entire “journey so far.”

Starting from April 7, 2025, under what kind of panic did the market turn danger into opportunity, and how did “big money” step in to provide support? Do you remember that?

Along the way, both the market and all participants have grown. It can even be said that the market’s mindset today is far more steady than it was back then.

As for “cautious,” it concerns something major: the gains and losses in individuals’ accounts. In the current context, perhaps it still means “watch more and act less,” avoid chasing after price surges, control position sizes, and so on.

Dongwu Securities believes that, at this stage, the rotation of market trends is highly tied to fluctuations in oil prices, and in the short term the pace of trading in the market is significantly influenced by the geopolitical situation. However, compared with overseas equity assets, A-shares are more stable. On the one hand, China is less sensitive to risks arising from rising crude oil prices; on the other hand, the continued repair of macro fundamentals and the support from micro-level capital provide backing. Entering April, uncertainty may fade, and by “seizing the April decision,” investors can look for opportunities with more certainty.

The institution specifically noted that market sentiment is not pessimistic, with more people taking a wait-and-see attitude. Although trading volume has clearly fallen recently—down to 1.67 trillion yuan as of April 3—this is still not lower than the low point in December 2025, and it is also significantly higher than the level in the first half of 2025. At the same time, the number of new brokerage accounts added in March was 4.6 million, second only to October 2024 and January 2026. Retail investors’ enthusiasm for entering the market is high and has not been suppressed by the market adjustment caused by geopolitical risks.

Overall, investors taking more of a wait-and-see stance leads to lower trading volume. But if risks ease somewhat, residents may accelerate their entry into the market.

In a research report, 湘财证券 said that from a short time dimension, after the conclusion of China’s two sessions, the market has returned to its normal operating track. At present, the ongoing conflict between the U.S. and Iran in the Middle East remains the main factor affecting the A-share market in the short term.

From a longer time dimension, 2026 is the opening year of the “15th Five-Year Plan,” and China will continue to maintain a proactive fiscal policy and a moderately loose monetary policy, providing important support for stable domestic economic operations in 2026 and for A-shares to maintain a “slow bull” trend.

Huaqin Securities pointed out that the current fundamentals may continue to rebound; overseas risks have largely been released; pessimism in sentiment has already been sufficiently priced in; and policy tone is relatively positive. A-shares may already have bottomed out in the short term. In the short run, it is suggested to continue to allocate on pullbacks to industries such as high-quality technology and parts of the cycle sectors.

A research report from Huayuan Securities stated that, overall, the war situation at this stage has little impact on China’s economy, and some industries are even slightly more favorable. Investors are advised to remain patient, cherish the “golden dips,” and actively track the energy main line and directions with stronger performance in the Q1 earnings reports.

Specifically, given that oil prices remain relatively high in the short term, the energy sector (both new and old energy) is still strongly favored. Meanwhile, referring to 2010–2011, when oil prices were around 100 U.S. dollars per barrel, most parts of China’s chemical industry chain (excluding large-scale refining and chemical integration) still had relatively good room for profitability, though there may be some disturbances in the short term.

On the defensive side, assets such as gold, consumption, and high-dividend names can be allocated. On the offensive side (if there is further downside or a period of staged easing), investors can actively consider AI computing power, domestically made chips, semiconductor equipment, and other areas whose boom conditions are still at relatively high levels, and focus on those with Q1 earnings reports that are expected to continue delivering high growth.

Next, as usual, we’ll review the news flow from the past few days.

Regarding the Middle East situation, besides the previously mentioned “hint of delaying by one day,” according to CCTV News, on April 5, Trump said that he believes an agreement with Iran can be reached by the 6th, and Iran is currently holding talks.

For other developments since last Friday, you can see the chart below.

For other news, you can also pay attention to:

Seven-day shipping volume through the Strait of Hormuz hits the highest level since the war broke out

According to ship-tracking data compiled by industry participants, over the past week (through April 4), the number of vessels transiting through the Strait of Hormuz increased somewhat. By Friday, the seven-day rolling average number of passing ships reached the highest level since the U.S.-Iran conflict broke out at the end of February.

China does not have large-scale oil-fired power generation

According to the Economic Daily, data provided by the National Energy Administration shows that China’s power mix is mainly coal-fired, hydropower, wind power, and solar power, with the share of oil-fired power generation being extremely low. The so-called “oil-fired power generation raises charging costs” is, in fact, a misreading of China’s energy mix.

Anthropic’s new rules take effect: extra charges for calls to Claude for third-party tools like OpenClaw

China’s embassy in Israel reminds: stay away from civilian infrastructure

CPC: China’s auto exports reach 1.55 million units in Jan–Feb 2026, up 61% year over year

According to data from the China Passenger Car Association, in Jan–Feb 2026, the auto industry’s profits were 43.5 billion yuan, down 30% year over year; auto exports from China were 1.55 million units, up 61% year over year; and in March the retail sales of new energy passenger vehicles were 784k units, up 69% month over month.

A-share Q1 earnings season begins: 12 listed companies’ net profits show the highest year-on-year growth of over 200%

Finally, here are some of the major events for the coming days this week (April 7 to 10).

April 7, Tuesday

China releases March foreign exchange reserves data. Previously, China has been adding to its gold holdings for 16 consecutive months.

CSRC’s “Several Provisions on Regulation of Short-Term Trading” officially takes effect

The document clearly defines the calculation standards for identifying shareholding and trading time points; it stipulates that the buy/sell time is the securities transfer registration date, and that the shareholding ratio of major shareholders is calculated by combining shares issued by the same listed and quoted company domestically and abroad; for overseas investors, the number of securities held through different channels is also combined.

April 8, Wednesday

Starting at 0:00, domestic refined oil enters the pricing adjustment window

Institutional forecasts say that under the domestic refined oil pricing adjustment mechanism, on April 8 the corresponding refined oil price increase will be about 130 yuan per ton, marking the sixth increase this year.

April 9, Thursday

The 14th China International Exhibition on Electronic Information (CITE2026) is held in Shenzhen, April 9 to 11

The Third AI Computing Power Industry Conference and Exhibition is held, April 9 to 11

April 10, Friday

The National Bureau of Statistics releases March CPI and PPI data

The U.S. will release March CPI data

Due to the spike in energy prices caused by the Iran war, markets generally expect inflation to rise significantly.

Cover image source: Each Daily Media Information Library

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